MUMBAI, October 17 — The Reserve Bank of India (RBI) issued an extensive regulatory framework on Saturday extending Card-on-File Tokenisation (CoFT) protocols to cross-border e-commerce transactions, bolstering consumer security in international digital payments.
Under the notified circular, authorized card networks and domestic payment aggregators will generate encrypted device- and merchant-specific alternate tokens for outward remittance and cross-border retail purchases. This eliminates the storage of sensitive primary account numbers (PAN), expiration dates, and CVV credentials on foreign merchant servers, significantly mitigating risks of international card-cloning and large-scale data breaches.
The central bank emphasized that token generation remains subject to explicit customer consent and robust Additional Factor of Authentication (AFA). The measure aligns with India’s Payments Vision 2025 document, ensuring world-class digital payment safety while facilitating friction-free cross-border commerce under the Liberalised Remittance Scheme (LRS).
Statutory powers of the central bank under the Payment and Settlement Systems Act 2007, the operational architecture of Tokenisation-as-a-Service, Foreign Exchange Management Act 1999 (FEMA) guidelines, and RBI's Payments Vision 2025 are fundamental syllabus themes across RBI Grade B, SEBI Grade A, and UPSC economic governance questions.